Tax Zone

Welcome to the Tax Zone. This area of the site is dedicated to keeping you updated on changes to tax legislation and its effects on financial planning. Here you will obtain detailed analysis on the budget, hints & tips and planning opportunities resulting from any changes made. This is intended to be a valuable resource for all our clients who wish to keep up-to-date and have a desire to take control of their financial affairs.

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Chancellor George Osborne delivered the first Conservative Budget for 18 years. Unconstrained by being part of a coalition administration, Mr Osborne set out a broad plan of action which seeks to define the political and economic landscape to 2020 and beyond. In fiscal terms he remains constrained by current the state of the deficit and has to make changes against a more febrile economic environment, as a result of the continuing Greek crisis, than he would have liked.

As ever, this is a very political Budget from a Chancellor who not only wants to complete deficit reduction for economic reasons but who is a true believer in the smaller state. This first Budget is important as it sets in train the reductions in welfare spending as well as across a number of other spending departments. These will be eye-watering for some, though perhaps over a slower trajectory than expected. Crucially, further constrained by a self denying pledge not to cut schools, health and international development budgets and an election pledge to not increase VAT, NI or income tax his options are narrowed. Indeed his party has been clear that some benefits, notably for those for pensioners, are sacred cows. This has left Mr Osborne with stark options for cutting and reforming.

The Budget set out well established themes: promoting a high wage, low tax country; a one nation budget with a focus on reforming welfare; and driving an infrastructure plan with an emphasis on a northern powerhouse and a focus on tackling weak productivity. There was a strong focus on welfare reforms, although other spending cuts will be detailed in the autumn Spending Review. As ever with Mr Osborne there were a number of surprises: the focus on reforming non-dom tax status, the introduction of a levy on large firms for apprenticeships and his ‘rabbit out of the hat’ the National Living Wage – expected to be £9 by 2020.